Monday, February 20, 2012
2/21/12 Mad bull
Every one of these images takes me back to an era my older kids will never experience during their coming-of-age years. However, the youngest one may- in 2019. I firmly believe, human nature being what it is, that the Two Thousand Twenties takes us back to the Nineteen Sixties. That's the beauty of this prolonged Great Recession- it can only mean good things in a few years, when we're all sick and tired of the gloom.
Of more immediate relevance, do we not all agree that SPX 1500 within a year is manifest destiny? In order to arrive at 1500, we must pass through 1400. There is no reason why we must first sell off to 1250 before we see 1400. We could easily see 1400-1450 prior to spiking down to 1250- now that would be a -14% hit, well suited to Hussman's calls for the 'abrupt destruction of speculative gains.'
I just don't think we sell off hard before breaking out to new highs. Bears should seek shelter- we're just a shot away from DJIA 13000.
I haven't really been following the financial news. When exactly is the 'meeting' re the Greek bailout supposed to end? Sometime tonight, or tomorrow?
ReplyDeleteDavid- Overnight futes will do their best to dislodge bulls prior to lift off in the morning.
ReplyDeleteMight as well catch a movie tonight.
ReplyDeleteDoes anyone really think the global Central Banks will allow us to come within 50 points of DJIA 13000 only to retreat?
ReplyDeleteI wasn't going to bother you guys with this nonsense, but I still can't believe it. Woo had an indoor game tonight. They play 6 per side and her team only had 4 players and the other team had 12. Woo's team won 8-5 and she had 7 goals. I really can't freaking believe it.
ReplyDeleteI think we lost quite a few participants last year.
ReplyDeleteFlint Energy Services (FES.TO) getting bought this morning by URS. They build the big oil sands plants in Canada.
ReplyDeleteEnergy services are by far the cheapest on a valuation basis of the groups in the energy industry and this helps confirm it. The large caps are cheap, but if you go into the small caps, you can get some great deals.
So for 2012, you've got energy service companies at low valuations, they all talk about their full books of business for 2012, and you've got oil rising which will drive more demand and even better margins. The negative to their business is the low price of natural gas and the related well shutins, so you want to pick the oil-leveraged ones.
Out of TVIX -.20 into UNG 5.48.
ReplyDeleteOut UNG on the mini pop and back into TVIX where I sold. Stop at day's low.
ReplyDeleteThis could be another BLT. I'll call it GST "Greek Salad Top".
Mark - that's pretty impressive man. It sounds like you have another Mia Hamm on your hands.
ReplyDeleteMy sense in watching this WFR trade is that it will skyrocket higher very soon. I just get the sense that they're trying to throw people off during this pullback so that it can go higher with fewer people.
WFR definitely the place to be TOF for those willing to hold for awhile.
DeleteSold TVIX +.20. VIX is already up 4% bumping up against support. It probably trades lower which isn't good for TVIX. Will look at DIA puts in a bit.
ReplyDeleteXLF - I would've guessed banks to rally based on the progress in Greece releasing them from CDS obligation?
ReplyDeleteGURE?
ReplyDeletewow nice bounce off the 200dma. They tried to throw people off the northbound train 2 days ago.
DeleteIn Mar 132 DIA puts
ReplyDeleteUGA gap needs to be sold. Per Sentimentrader, one of the most lopsided commodity bull/bear ratios on record.
ReplyDeleteAAPL looks like it wants to go higher. Wouldn't be surprised to see it hit $513 over the next couple of days when news of stock split/cash distribution comes out at the shareholder meeting. After that, there's no stimulus for the stock.
ReplyDeleteWFR sure seems to like the 4.71 area.
ReplyDeleteGAZ up nearly 100% off the lows. UNG up around 8%.
ReplyDeleteArb trade would probably work well going forward here as GAZ is way extended. Long UNG, Short GAZ. No position.
TZOO had one of those little spikes through support today.
ReplyDeleteSold the puts for a loss and put funds into some UNG calls and BOIL common.
ReplyDeleteI like nat above 2.55 which is 21 day moving avg. and monthly bolinger band.
GRVY train continues northbound
ReplyDeleteSolars are heating up today....well, all of them except my WFR of course.
ReplyDeleteAs long as WFR's hammer holds from Thursday, she could re-test 6 in the next few sessions imo. Regardless of my market bias, solars look good.
DeleteThe current action looks a lot like a handle in a 4 month WFR Cup and Handle that projects to about 8.
DeleteOk Jesse now you're just messing with my mind.
DeleteGiven the long-term chart pattern,the GAAP reversals that nobody knows about and eps surge beginning in Q4, I see a real possibility of WFR hitting at least $25 w/in 16 months.
DeleteAnatomy of this market? How overbought gets more overbought.
ReplyDeletehttp://www.ritholtz.com/blog/2012/02/here-comes-dow-13000/
BTW, UUP flirting with the 21's again. Never thought I would be a forex trader....
umm RDN? I can't believe I had a full position at $2.4 and sold at $2.5
ReplyDeleteummm....I can't believe I had a full position at 2.20 and sold it for a loss! :)
DeleteThose kinds of trades convince me that we need to manage our position sizes better. That's why I'm going with a few different positions at a time. If I had a full position in GRVY I wouldn't be willing to let it ride higher. I probably would have sold at $2.8 the other day. Sure you miss the big gains but you also don't sell out too early because of fear of the trade going south on you.
DeleteSilver needs to recover the $34.48 level, else it's probably sink city again.
ReplyDeleteCoal don't look too bad to me, BTU would be my pick that goes nowhere but down...
MDW - Well, if the obvious isn't enough, just cover it up with more of the same obvious ointment, MDW did test the $1.80 trend line and now headed back up.
ReplyDeleteThe obvious target from here would be, oh, let's just say, north of $2.30 as a shotgun target for the time being then go from there....
Some news out on my IMMR today:
ReplyDeletehttp://finance.yahoo.com/news/Sanyo-Automedia-Immersion-bw-1073911239.html?x=0
Chart looks good on this one. I have a really small position (about 5% or so) but it's really a play on patents. They own about 600+ patents on haptics, or force feedback on touch screen devices. They licensed this to Samsung and Nokia and several other companies in the smart phone sector. They're going after Motorola and mentioned Apple and other cell phone makers. About 5 years ago they won a big suit against Sony because Sony was using their technology in their rumble controllers for Playstation. They decided to change their strategy to a license strategy but that never really made them much money. A hedge fund with solid returns recently took about a 9% stake in the company and I'm assuming they put some pressure on them to return to patent lawsuits because that's where the value of this company is. Clearly the recent jump in the stock when they announced the Motorola lawsuit confirms that there is more value in going this route. Its an interesting company that never really took advantage of the explosion in smartphones but I think it still has the potential to explode via its patents.
IMMR - There's an open gap down there at ~$8.75 that needs filling...
ReplyDeleteAAPL hit my 513 target.
ReplyDeleteLooks like rates are about to finally break out.
ReplyDeleteBest tweet of the day:
"Joe Kunkle @OptionsHawk
THe $TLT is ready for the Jimmy Snuka Superfly off the top rope....
Tomorrow should be very very interesting for natty. Natty jumped 10% when CHK announced production cuts and 6% when encana announced cuts during its earnings call.
ReplyDelete5 of the top 25 natural gas producers report in the next 24 hours.
HL - Earnings response
ReplyDeleteJesse - The upside to taking a big position in a stock is selling after a nice short term spike because the gain is big and then watching the stock drop. If I did that with GRVY there's a good chance I would have been out with today's spike. Instead I'm still holding after a drop of 7% from the highs. Catch 22.
ReplyDeleteDepending on mkt conditions, I may join you in GRVY 2.40-2.50 if it can set up. Up roughly 300% in 2 months, it'll take breather at some point to kick out old longs and let us new ones in.
Delete300%? I'm calculating 190%. But I agree it's due for at least consolidation. Valuation is still compelling though given the industry it is in.
DeleteCNAM - BOOM! But who knew?
ReplyDeleteThe chart knew. That's a classic transitional chart (see MA's cross up) that then corrects, resumes trend, breaks out and forms a cup and handle and breaks out again. I guarantee, there were technical traders all over this one. Just not me.....yet. Now I have to wait for it to correct and pullback to reality. Awesome transitional chart. We all need to find a bunch of those.
Delete13,005 is the magic #. 13,021 pre-market.
ReplyDeleteI know tomorrow is a Wednesday, but I'm going to celebrate anyway. Later of course. I picked up the salt yesterday and I have a good selection of primary ingredients.
ReplyDeletehttp://www.margaritaville.com/margaritaday
National Margarita Day. I hope it applies down here. I have a hot (not at all) date tomorrow night:)
DeleteYou know what to do Jesse. If it's 4th of July you always know it.
DeleteThe good part is it will likely cost you less than just about anyone else to celebrate.
Bought some of that AHT that I talked about a few weeks ago. This is the hotel REIT that is trading at 60% of book. It traded at 130% of book from 2003 - 2006 before the economy tanked. The hotel industry was hit very hard by the recession, but this has meant underinvestment in new hotels, so as the economy improves, these hotels will have leverage to raise prices. Choice Hotels this morning stated they expect revenue per available room to be up 8% in Q1 (which we are half through) and 5% for 2012, so things are turning.
ReplyDeleteWhen I asked about it, it had taken off to $9.50 and thought I had missed it, but pulled back since and I got at $8.82.
If it can get back to 130% of book in 2 years, that would give be a 48% annualized return including dividends. 3 years would be 31%.
AAPL 113.94 should hold as secondary top in triangular topping pattern. Me thinks that's all she wrote for AAPL. The next few years she should trade similar to CSCO and MSFT after their divy's.
ReplyDeleteThe big question will be who will lead the next bull phase down the road?
FSLR? WFR? 3D printing? Mortgage Co.'s? Shippers? Coals?
Who benefits from higher yields?
DeleteGood question. From a company standpoint I have no idea. From a stock perspective, probably the highest beta. Probably solars.
Deletewow....GRVY. I went out for 30 minutes to pick up the lil guy and lo and behold!
ReplyDeleteAlright...I sold my IMMR and bought some more GRVY at $2.65
ReplyDeleteDANG earnings gonna be very interesting on Thursday morning.
ReplyDeleteI wouldn't want to hold anything into earnings going forward, but I'll definitely be watching their earnings. W/ Shanghai rolling over w/ 8 reversals in 9 sessions, I'm not too sure stock will react too well even if earnings are good. We'll see.
Definitely some steam coming out of the high fliers of 2012. It's the shippers' turn today.
ReplyDeleteAdded a little more GRVY at $2.62. Avg is now around $2.66.
ReplyDeleteJesse - It looks to me like Shanghai is actually breaking out. It closed above short term resistance at 2366.
ReplyDeleteI think today is a natural reaction to DOW 13,000. This market is going higher fellas.
7 downside reversals from outside upper bolinger band in last 8 sessions for Shanghai. That's the kind of action I look for at tops and bottoms in any market/stock. We'll see.
Deletehttp://stockcharts.com/c-sc/sc?s=$SSEC&p=D&b=5&g=0&i=p89249176841&a=111487104&r=71
CNAM - Okay, I see the C&H now...
ReplyDeleteCNAM - It doesn't count much though, unless you identify the C&H in advance, and then get the entry timing right.
ReplyDeleteI see many of the same characteristics in the SVM chart but I'm not going to fool myself into thinking this has a snowball's chance of duplicating today's CNAM action.
Okay CP, check this out. This is more or less the Landry game.
DeleteThe bottom arrow is the MA cross, AKA a bowtie.
The top arrows are possible entries as the trend resumes. The green bar on the 27th that closed strong above the close of the 23rd would have been a good entry too. Then they tried to shake out weak hands until the green bar of 2/14.
The trick is to look for stocks making new highs off of bottoms (transitions) bowties to confirm, and then pullbacks that get bought to confirm the resumption of the trend.
You would have been holding any of those entries and the C&H would just happen with you on board.
http://screencast.com/t/lXL6oiF1Eig
This is still a nice find! It closed at .86, it could still pullback, go through the process all over and run much higher.
No because SVM pulled back into the previous range. It's not the same chart at all, plus it has that gap to open the 10th and closes weak.
DeleteNot to say it couldn't or won't turn around, it's just not my kind of a set up.
If it had stopped on 2/09 and continued higher it would have been a nice set up.
$34.48 is just a gnat's butt away...
ReplyDeletehttp://blogs.marketwatch.com/cody/2012/02/21/apples-current-set-up-for-traders-and-investors/
ReplyDeleteI'm sure Dell's guidance should be decent given their kick ass ultrabook coming out in a couple weeks.
ReplyDeletewhich one is that? we're looking at getting a new computer.
DeleteDELL ultrabook hits San Fran:
Deletehttp://en.community.dell.com/dell-blogs/direct2dell/b/direct2dell/archive/2012/02/06/the-ultrabook-challenge-dell-xps-13-ultrabook-hits-san-francisco.aspx
Another reason why I'm bearish on AAPL longer term. We'll see a big shift.
Not exactly an unbiased website considering it's dell's website, but I have to say I have owned several PCs over the years and the one time I strayed from a DELL (for my current laptop which is an HP) I was VERY disappointed with the result. Although, I have had Lenovo's through work and they were great. The HP I have now is atrocious. I can't leave it on for more than about 6 hours without it freezing so I have to shut it down every day. I have lost 5 keys on my keyboard. And its about as loud as a small airplane.
DeleteI've been looking at Samsungs and Dells. Besides the Macbooks they are the two best rated computers on Consumer Reports and CNet, at fractions of the price. I honestly wouldn't mind getting a Mac but I don't want to bother with relearning operating systems.
The downside to those Ultrabooks is they're really not heavy duty computers. I have some paint programs and usually have like 30 windows open when I'm working on my web stuff so I need something powerful.
AAPL shareholder meeting Thursday at 1pm. Have a feeling its gonna be bigger than a Fed announcement. Lots of volatility.
ReplyDeleteThe life insurance companies are the most direct winner from higher rates. The reason their current valuations are so low is because of the reinvestment risk that when their long term bond holdings come due, they will not be able to invest them at high enough rates to cover their future liabilities.
ReplyDeleteNot the most exciting socks from a trading perspective, but valuations are very low on lifeco's now and higher rates should make investors more comfortable to give them higher valuations and profits will increase over the longer term.
CLNT looks ready for another push soon. 50 dma curling up for first time in years:) Too bad it literally takes 10 trading sessions to get a modest position.
ReplyDeleteLooks like CSIQ was the play in the solars.
ReplyDeleteCNAM - A-OK on the CNAM, how about SCOK then, this one looks close to the CNAM setup...???
ReplyDeleteCP- SCOK has an outstanding weekly chart. If and when the coal sector turns up, SCOK should fly.
DeleteCYD - Or maybe this one, but the handle has yet to form?
ReplyDeleteHere's one for us.
ReplyDeleteRecord high public opinion sentiment in Live Cattle. Every couple of years, cattle opinion spikes and pokes its head above the upper bolinger band (as it is currently). In every case, it collapses over the next couple of months.
How the hell do we play this?
Buy the heck out of TOF's RUTH?
Very similar situation in unleaded gas at the moment. Bullish for airlines once they bottom.
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